M/s. Guru Maharaj Construction, Cuttack V. ACIT, Circle-2(1), Cuttack, Cuttack

ITA 373/CTK/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7610 (ITAT-CUTTACK)
• Duration Of Justice: 2 year(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 05-10-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 25-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause

Judgement Text

1 ITA NO.373/CTK/2014 ASSESSMENT YEAR :2009 - 2010 IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK SMC BENCH, CUTTACK BEFORE SHRI N. S SAINI, ACCOUNTANT MEMBER ITA NO. 373 /CTK/2014 ASSESSMENT YEAR :2009 - 2010 M/S. GURU MAHARAJ CONSTRUCTION PRATIVA NIWAS,AURONODAYA NAGAR, CUTTACK - 12. VS. ACIT, CIRCLE - 2(1), CUTTACK PAN/GIR NO. A AAFL 4732 G (APPELLANT ) .. ( RESPONDENT ) ASSESSEE B Y : SHRI SASWAT ACHARYA, AR REVENUE BY : SHRI SUVENDU DUTTA, DR DATE OF HEARING : 05 /10/ 2016 DATE OF PRONOUNCEMENT : 05 /10/ 2016 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT( A) - CUTTACK, DATED 10.12.2013 , FOR THE ASSESSMENT YEAR 2009 - 2010. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL IS THAT THE LD CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1 1,82,054/ - BEING THE AMOU NT OF INTEREST PAID TO MAGMA FINANCE, TATA CAPITAL AND CHOLAMANDALAM FINANCE DURING THE YEAR WITHOUT DEDUCTING TDS U/S. 194A OF THE ACT. 3. THE APPEAL FILED BY THE ASSESSEE IS BARRED BY LIMITATION BY 183 DAYS. THE ASSESSE HAS FILED CONDONATION PETITION A LONGWITH AFFIDAVIT EXPLA INING THE REASON OF DELAY IN FILING THE APPEAL BEFORE THE TRIBUNAL. AFTER PERUSING THE PETITION AND HEARING THE PARTIES, I AM SATISFIED THAT THE ASSESSEE HAD REASONABLE CAUSE FOR NOT FILING THE APPEAL 2 ITA NO.373/CTK/2014 ASSESSMENT YEAR :2009 - 2010 WITHIN THE PRESCRIBED DUE DATE AND, THEREFORE, I CONDONE THE DELAY AND ADMIT THE APPEAL FOR HEARING. 4 . I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE, THE ASSESSEE HAD PURCHASED ASSETS UNDER EMI BY GIVING POST DATED CHEQUES TO MAGMA FINANCE, TATA CAPITAL AND CHOLAMANDALAM FINANCE. THE REPAYMENT BY POST DATED CHEQUES INCLUDED INTEREST AMOUNT ALSO. DURING THE YEAR, THE ASSESSEE CLAIMED DEDUCTION TOWARDS INTEREST PAYMENT TO THREE PARTIES OF RS.11,82,054/ - WHICH WAS DISALLOWED BY THE AO ON THE GROUND THAT THE ASSESSEE FAILED TO DEDUCT TDS FROM THE INTEREST PAYMENT AS PER SECTION 194A OF THE ACT. 5 . ON APPEAL, THE LD CIT (A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 6 . BEFORE ME, LD A.R. OF THE ASSESSEE RELIED ON THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. VICTOR SHIPPING SERVICES (P) LTD., (2013) 357 ITR 642(ALL), WHEREIN, IT HAS BEEN HELD THAT FOR DISALLOWING EXPENSES FROM BUSINESS AND PROFESSION ON THE GROUND THAT TAX HAS NOT BEEN DEDUCTED AT SOURCE, THE AMOUNT SHOULD BE PAYABLE AND NOT IT HAS BEEN PAID B Y THE END OF THE YEAR AND SUBMITTED THAT IN THE CASE OF THE ASSESSEE, THERE WAS NO AMOUNT OF INTEREST OUTSTANDING AND PAYABLE TO THREE PARTIES AND HENCE, NO DISALLOWANCE UNDER SECTION 40(A)(IA) OF THE A CT OF RS.11,82,054/ - COULD BE MADE. HE FURTHER SUBMITTED THAT THE SLP FILED AGAINST THE JUDGMENT OF HONBLE ALLAHABAD HIGH COURT HAS BEEN DISMISSED BY THE HONBLE SUPREME COURT VIDE JUDGMENT DATED 2.7.2014 IN CC NO.(S) 8068/2014. 7 ON THE OTHER HAND, LD D.R. DID NOT RAISE ANY SERIOUS ARGUMENTS DURING THE COURSE OF HEARING. 8 . ` AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, I AM OF THE VIEW THAT AS THERE WAS NO AMOUNT OF INTEREST OUTSTANDING AND PAYABLE TO THREE PARTIES A T THE END OF THE YEAR , NO DISALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT OF 3 ITA NO.373/CTK/2014 ASSESSMENT YEAR :2009 - 2010 RS.11,82,054/ - COULD BE MADE IN VIEW OF THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF VICTOR SHIPPING SERVICES (P) LTD (SUPRA).. HENCE, I SET ASIDE THE ORDER OF LD C IT(A) AND DELETE THE DISALLOWANCE OF RS.11,82,054/ - MADE BY THE AO U/S.40(A)(IA) AND CONFIRMED BY THE LD CIT(A). 9 IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 05 /10/2016 IN THE PRESENCE OF PARTIES. SD/ - ( N. S SAINI) A CCOUNTANT MEMBER CUTTACK; DATED 05 /10 /2016 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASST.REGISTRAR, 1. THE APPELLANT :M/S.GURU MAHARAJ CONSTRUCTION PRATIVA NIWAS,AURONODAYA NAGAR, CUTTACK - 12. 2. THE RESPONDENT. ACIT, CIRCLE 2(1), CUTTACK 3. THE CIT(A),CUTTACK 4. CIT , CUTTACK 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//